Many global banks and regulatory bodies have failed to achieve the desired results for customers, investors and regulators since the financial crisis despite the changing structural reforms, according to KPMG’s annual Evolving Banking Regulation report.
KPMG financial services regulatory centre of excellence EMA head, Giles Williams, said the goalposts are constantly changing and additional layers of complexity keep piling up from regulators with differing agendas and conflicting timeframes.
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"The length of time it takes to finalise initiatives is also letting us down. If the recently released structural reforms from the European Commission are implemented as planned in 2017 and 2018, almost a decade will have passed since the height of the financial crisis," Williams added.
The report predicts that there will be more casualties before the financial crisis is over. According to KPMG, banks must focus on four key areas including structure, conduct and culture, data and reporting, and risk governance.
Giles commented that several banks have already take steps to revise their legal entity structure and to reduce and restructure their balance sheets. This along with the emerging Basel 4 accord will enable banks to increase the cost of doing business.
"Retail banks are looking to become customer centric, but are finding this hard to deliver given legacy systems, culture and client resistance to change," Giles said.
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